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Welcome back to Current Climate. The Trump administration’s hostility toward Joe Biden’s clean energy programs has stymied offshore wind and green hydrogen projects and depressed sales of electric vehicles. But surging demand for electricity, driven by the unchecked growth of power-thirsty AI data centers, continues to underpin boom times for the battery storage industry.
The U.S. added 9.7 gigawatt-hours of battery storage capacity in this first quarter, up 32% from a year ago and a record for the period, according to the Solar Energy Industries Association and Benchmark Mineral Intelligence. At the current pace, the country may have over 610 GWh of energy storage in place by 2030. Much of that capacity is paired with solar and wind systems, helping to limit the growth of climate-warping carbon emissions from fossil fuel-generated electricity.
“Energy storage is no longer just for backup; it’s critical energy security infrastructure,” said Benchmark Mineral researcher Shan Tomouk.
That demand has led companies such as Ford and General Motors to redirect battery projects away from EVs, sales of which fell 27% in the U.S. in the first quarter following Trump’s elimination of the $7,500 federal tax credit, to get into the energy business, an area in which Tesla has competed for years.
While the battery boom is a positive development, overall U.S. investment in clean tech dropped 9% in the quarter from a year ago to $61 billion, according to The Clean Energy Monitor. That decline largely reflected the drop in EV sales from a year ago. Unfortunately, announced investment plans for clean tech manufacturing totaled just $2 billion in the quarter, plunging by 79% from 2025’s first quarter and the lowest level in more than five years.
Should the Trump administration realize that its antipathy toward renewable energy has gone too far by hurting economic growth and increasing power prices, that could change. For now, however, the global renewable energy boom that’s accelerated as a result of Trump’s war in Iran appears likely to bypass the U.S.
Tesla Chairman and CEO Elon Musk unveils the new "Semi" electric Truck to buyers and journalists on November 16, 2017 in Hawthorne, California, near Los Angeles. / AFP PHOTO / Veronique DUPONT (Photo credit should read VERONIQUE DUPONT/AFP via Getty Images)
AFP via Getty Images
Two decades ago, when Tesla was a scrappy Silicon Valley startup, California’s pollution rules let it earn free money selling emissions credits to automakers hawking big gas hogs. Its wealthy, environmentally minded consumers became the backbone of its electric car business. That kick-started the modern EV industry and helped CEO Elon Musk become the world’s wealthiest person.
He has not been gracious about it.
Musk moved Tesla’s headquarters out of California in late 2021. He moved himself out a year earlier after ranting on an earnings call about “fascist” rules requiring Tesla to briefly halt production at its Fremont plant at the start of the Covid-19 crisis and has said the state's regulatory agencies are intent on making “almost everything illegal.” He’s claimed the idea that Tesla relies on subsidies is farcical. “Take away the subsidies. It will only help Tesla,” he wrote back in 2024. “Also, remove subsidies from all industries!”
Now the Golden State, with the country’s most generous clean truck incentives and a vast trucking sector, is helping ex-Californian Musk yet again by serving as the main first market for Tesla’s latest offering.
The Tesla Semi — the battery-powered heavy-duty truck Musk debuted nine years ago and finally put into production in Nevada in April has so far drawn more than 1,200 California “HVIP” vouchers for buyers of zero-emission heavy-duty vehicles, worth $172 million. That’s double the number awarded to Tesla’s closest competitor. Those vouchers knock $120,000 off the Semi’s sticker price, which ranges from $250,000 for a 300-mile version to $290,000 for the 500-mile model, based on a copy of Tesla’s pricing sheet obtained by Forbes. And with an additional $1 billion of new funding for non-polluting trucks announced on May 13, the state is poised to be even more critical to Tesla.
VEMA Hydrogen
You’ve got a potential deal to supply hydrogen you’re creating in Quebec to Charbone, a Canadian industrial gas company. Will you be piping or trucking it to them?
No. Our strategy is we don't want to transport or store hydrogen because this is very expensive and that's killing the economics of what we do. What's the use of being able to produce low-cost hydrogen if all the benefits are lost in transportation?
What we produce is basically raw [hydrogen] gas. We can do the primary cleaning, remove a bit of CO2, and the water, but we can't do advanced refining of hydrogen. This is a specific technology. We may do that, but honestly, why would we improvise ourselves of refiners of hydrogen if your partner can do so? We’re better off focusing on what we are good at: producing hydrogen.
Basically, Charbone's part of the deal is that they refine the hydrogen from the wellhead, and then they transport it to their partners and clients. This is very good for them because they don't have the hydrogen, at least not decarbonized, at a good price.
The entire strategy of Charbone is onsite transformation of the hydrogen, which can then be used for electricity for data centers, high-purity hydrogen for specialized uses, or it can be [turned] into methanol, for example, for the shipping industry, into SAF for the aviation industry, and so on. And it can be used for a new one: e-methane. We see more and more demand for e-methane at a decent price. At the moment, most e-methane projects are totally underwater because when you look at the economics, you just run away. The main culprit is the cost of hydrogen. But if you get hydrogen at a decent price, then you can have e-methane at a price that is competitive with classic methane.
Charbone is a specialist in the distribution of high-purity hydrogen in Canada. We started discussions a while ago. …They are very interested because they need a source of clean hydrogen at a decent price, which is pretty much non-existent, especially in Quebec, because most of the green hydrogen projects are too expensive or have just failed.
When we told them we were starting to produce hydrogen in Quebec, they were very interested, and we made a deal. For us, it's extremely interesting because the type of client Charbone is addressing is typically either mobility or specialist clients who need high-purity hydrogen. And the quantity of hydrogen those clients use is a bit small compared to our main markets.
Charbone, we see them selling to mobility customers, like buses using hydrogen, trucks using hydrogen and what we call specialty users who need very high hydrogen purity.
Are you sharing the financial terms of the deal?
I don't think so. I will tell you that the price is pretty good for us and good for them. We’ll make money. They’ll make money.
Trump eases restrictions on climate ‘super pollutants’ (New York Times)
U.N. General Assembly embraces court opinion that nations have a legal obligation to take climate action (Inside Climate News)
Young Americans demand that federal court halt Trump’s biggest rollbacks of pollution protections (The Guardian)
Denver has a plan to heat and cool buildings without fossil fuels. It involves … sewage? (NPR)
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